NEXT YEAR'S BUDGET TO SPUR ECONOMY, SERVICES SECTOR, SAYS PM

PUTRAJAYA, June 11 (Bernama) -- The 2010 budget will emphasise on ways to
spur the country's economy by making it "high income" based, with the services
sector playing a pivotal role in the new economic model currently being
finalised, Prime Minister Najib Razak said.

Najib, who is also Finance Minister, also promised that all government
policies would be consistent, with no "U-turns or flip-flops".

Policies, he said would be designed to spur growth and instill greater
confidence among investors for an improved inflow of Foreign Direct Investment
(FDI), taking into account the stiff competition due to the global economic
meltdown.

"FDIs worldwide are expected to be 50-60 percent less than what was
available last year. We need to get a slice of that (remaining FDIs)," Najib
said in his opening address at the 2010 Budget Consultation meeting here today.

"We have to look at how to ensure greater confidence in terms of
government policies. We have to be market friendly and generate more domestic
activities.

"At the same time, we must create a more just and fair society.This goal
has not been forgotten or put on the backburner. The root is that, we have to be
more market friendly and at the same time, have a just and fair society," he
added.

The Prime Minister also revealed that he would make a "major announcement"
pertaining to greater liberalisation at the 2009 Invest Malaysia at the end of
this month.

"We are tackling the short term challenges.It is important for us to chart
a new direction for the country with a new economic model developed by the
goverment," he said.

He also said that the medical sector, especially medical tourism, would be
placed in the high priority basket "to position Malaysia as a world class health
care services provider".

According to Najib, the proposed Corridor developments, especially the
Iskandar Regional Development, would also continue as Malaysia saw ample
potential in these projects.

On creating a just and fair society, he said it would emphasise on
addressing the needs of every community.

On assistance to Bumiputeras, he said it would be targeted at those
deserving it.

"Helping the Bumiputeras (sons of the soil) in the wrong way may not be
sustainable. We want to make them more resilient and competitive. To rely on a
quota is something that is unrealistic. We have to identify good Bumiputera
companies rather than rely on a quota," he said.

He said greater liberalisation will come with more competition within
companies in Malaysia and from aboard.

"So, we have to look at ensuring that Bumiputera companies are not
eliminated in the process and there are ways and means to help them, not so much
in the traditional manner but in making them more resilient," he explained.

On the size of next year's budget, he said, the government was currently
looking at its revenue forecast and expenditure.

"We need to fine-tune that.I would not want to commit to the figure at this
stage as I want to be as precise as possible," he said, when asked if the
size of the budget would be RM200 billion as indicated earlier.

The government, he said wants to table a budget that is well accepted by the
market, which is looking at the deficit.

"A large deficit is only acceptable if it is temporary and I think people
are talking in terms of between 1-2 years," said Najib.

He said, the budget deficit figures would be announced when the 2010 budget
is tabled.
-- BERNAMA